Mortgage approvals on the rise

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The number of home loans approved by the UK's major banks rose in September and is now at a level not seen since the end of 2007.

Figures released by the British Bankers' Association (BBA) show banks approved 42,100 loans for home purchase last month, up from 40,100 in August.

The number of agreed home loans was much improved on the average number recorded over the last six months (35,486), while September's figures represent a 76 per cent improvement on the number of mortgages approved in the same month last year.

"Mortgage lending by the high street banks is continuing to improve from the lows seen earlier this year and the number of house purchase approvals continues to recover," said the BBA's statistics director, David Dooks.

"Housing market activity will depend, however, on more properties coming on to the market. Apart from property decisions, further symptoms of subdued consumer confidence are a reduced appetite for unsecured borrowing and more saving."

Remortgaging slumped once more, with banks agreeing 21,282 new deals last month – a number down on a monthly, six month and annual basis.

"Remortgaging is less likely in the current environment," said the report, "where reverting to standard variable rates may be more attractive than alternative deals."

Approvals for equity withdrawal ticked up slightly to 19,375 although this, too, is historically low.

On 31 December, phase two of the Help to Buy initiative will be withdrawn from the market. It’s certainly done wonders for the high loan-to-value sector, so we thought we’d take a closer look at the significance of the scheme and the effect it’s had.